interesting trading patterns

I’ve been out of the loop for most of today and missed the carnage in the market following Wall Street’s demise last night. My absence was not such a bad thing, as sometimes it is best to just look the other way when we are swamped by the wash up of an overnight slump in overseas markets. (On second thoughts, maybe carnage is a bit strong, let’s call it a down day)

RRS’s fall, as with a lot of other stocks, must be seen in context with all of the panic surrounding world markets. However it was encouraging to see the light volume in RRS on a difficult market day.

Interestingly, the opening trades were at 55.5 cents, (ie. yesterdays close) but it was the first 4 broker cross trades that were instrumental in guiding the share price to its lows. The sequence was as follows.

Opening trading was @ 55.5 cents commencing @ 10.17.09
First X Trade was @ 54 @ 10.29.07 effectively a 1.5 cent drop from 55.5 cents
Second X Trade was @ 54 @ 10.36.31 supporting the current low
Third X Trade was @ 53 @ 10.38.15 forcing a new low, and representing a 1 cent drop
Fourth X Trade was @ 52 @ 10.56.47 forcing a new low, and representing a 1 cent drop

Cross trades amounted to around 36 K shares out of a total of 161 K shares traded.
X Trades ignored the 0.5 increment (or should that be decrement?) available and commenced with 3 times that amount (1.5 cent drop), then twice the amount (1 cent drop) for the other two take downs.

Today’s take down coincides with a posting rate by the forum’s Stock Bashing team which is running at around 35% of all posts.

Interestingly, the same pattern of broker ‘cross trading’ leading to successively lower prices, was also in place last Thursday (ie. Nov 1st). The low achieved that day was 49 cents, although the price recovered slightly to finish at 50.5 cents. You will recall on that day the usual Stock Bashing suspects, Pongosniffavitch, Scarva and Insidemoney had a field day with their negative antics. The conjecture back then focused on a misleading report by www.garoweonline.com This was on top of nervousness again emanating on Wall the night before. The misleading report was corrected the next day via a company announcement. The posting rate of the Stock Bashers ran at around 36% that day.

Some Conclusions:
- The stock is manipulated by broking interests
- The stock is subject to intensive stock bashing
- General market weakness is used as an excuse to shake stock free from nervous holders
- The intensive efforts to spread negative sentiment speaks of accumulation by manipulative interests.
- Maybe the contracts of the Stock Bashers stipulate a 35% posting requirement before they get paid for their days work.

Some Positives:
- The AGM and the passing of all Resolutions will remove certain overhead constraints that have had the stock trading in limbo.
- The drilling scheduled for Jan/Feb 2008 gives a chance for the current turbulence in world’s financial markets to settle down
- The political situation regarding Somaliland’s incursion into Puntland could very well be resolved by drilling commencement, although as indicated by the company it is not expected to be an issue
- The oil price tends to firm during the Northern Hemisphere winter, focusing even more attention to companies searching for Oil.

Advice:

Re The Market:
Be prepared to chill out for a couple of months, although we could see some surprises once the AGM is out of the way.

Re: The Stock Bashers
Put them on ignore
Avoid engaging them in dialogue simply by not addressing anything they 'vomit' on to the forum.
Complain to the moderators

Regards to genuine posters
Nev